Capital Group Approved To Use Fidelity Wrapper

Ninth-largest asset manager in the world cleared to use Fidelity’s active wrapper.

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Reviewed by: Dan Mika
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Edited by: Dan Mika

Capital Group has been cleared to use Fidelity’s wrapper for actively managed, semitransparent ETFs, giving the ninth-largest asset manager in the world that option in future launches as it moves closer to launching its first suite of ETFs.

In an SEC filing Wednesday afternoon, regulators allowed the mutual fund group to operate ETFs with an exemption from the requirement of daily portfolio transparency, and to use prenegotiated market prices in secondary market sales instead of net asset value.

Capital Group filed for its first ETFs in 2014 as fully nontransparent vehicles, and later licensed the Fidelity methodology because it allows for semitransparent funds. 

However, the approval doesn't mean the issuer's first funds will use the Fidelity model. In a call with reporters in August to announce the filings, Capital Group Head of ETFs Holly Framsted said the first group of funds to launch will be fully transparent.

The six ETFs became effective with the SEC on Dec. 17, 2021, and Capital Group expects to launch the funds by the end of the first quarter of 2022.

 

TickerFundExpected SegmentsExpense Ratio
CGCPCapital Group Core Plus Income ETFCurrent Income/U.S. Treasuries & Corporate Bonds0.34%
CGGOCapital Group Global Growth Equity ETFGlobal Equities/Growth0.47%
CGCRCapital Group Growth ETFGrowth Equities, 75% U.S.0.39%
CGDVCapital Group Dividend Value ETFCurrent Income/Equity Dividends0.33%
CGXUCapital Group International Focus Equity ETFGrowth Equity/ex-U.S.0.54%
CGUSCapital Group Core Equity ETFU.S. Equity0.33%

 

Contact Dan Mika at [email protected], and follow him on Twitter

Dan Mika is a reporter for etf.com. He has previously covered business for the Ames Tribune and Cedar Rapids Gazette in Iowa, and BizWest Media in Fort Collins, Colorado. Dan holds a bachelor's degree in journalism from Truman State University.